GREAT BRITAIN'S TASK

Rotorua Morning Post, Volume 1, Issue 71, 14 November 1931, Page 4

GREAT BRITAIN'S TASK

The complexity of Great Britain's task in the erisis and the dangers that beset her return to prosperity were the main themes of the Prime Minister's speech at the Guildhall and were traversed again in the Speech fronq the Throne at the opening of Parliament. Britain's special pdsition as a world Power makes many of her problems dependent for solution on international j co-operation, a goal toward which Mr. Ramsay MacDonald has ; set his Government. Aparfc from the international sphere, j although influenced hy it, are Britain's domestic problems to which also the new National Government is addressing itself. These are chiefly to balance the^ Budget, to restore the balance of trade, and to stabilise the pound sterling — all interlocking more or less. _Mr. Snowden has already secured Budgetary equilibrium in the current year1 and the business of the new Chancellor, Mr. Chamberlain, is to provide against the Budget of next year in which the May Committee estimated the deficit would be £170,000,000. That figure has been substantially_reduced by Mr. Snowden's economies but Mr. Ghambeflain still has a wide gap to fill. To restore the balance of trade is a much larger matter, involving the whole national economy and the condition of world trade and financef as well. In her international dealings Britain has beeh accu'stomed to come out with a surplus of between 100 and 200 millions, and even in 1930 was 39 millions up on balance. This year one of the highest authorities reckons the usual credit will be transf ormed into a debit of 100 millions, although other estimates are lower. And, so long as world trade is depressed, Britain cannot expect to derive much income _from her overseas investments, shipping, and financial services generally. One thing ,she can do, however, is to tighten her belt, strive to live within her reduced income. Economy, therefore, is one of the cardinal virtues to be practised by the National Government, not only in public expenditure but in measures influencing •the nation's spending. The depreciation of the pound, although involuntary, is assisting.the proeess by encouraging exports and restricting imports except when, .as in our own case, countries have elected to follow sterling. It remains to be seen whether monetary influences on Britain's trade balance are to he reinforced by a tariff. At any rate it is apparent froni Mr. MacDonald's speech that an early effort will be made to stabilise the pound at a point below the old level. Obviously Britain has her hands full, and overfull. Compensation rests in the fact that she has realised she is up against it and has confided her destiny to a strong and able Government. The Cabinet is supported in whatever it may do by the almost unanimous decision of the people to give it a free hand. This manifestation of the national spirit — unity in action — has stabilised the political situation and inspired universal confidence, an invaluable asset that New Zealand would do wel! to acquire out of her own elections.